Dawn, As others have said your post it timely and excellently written. As you said the guidelines presently call for 2 years after Completion date. (no exception per present FNMA guidelines) If a seller is in the position where a mortgage modification that is acceptable to the lender and affordable to the seller it should be considered. This can be a good option for the Lender, the owner and the real estate market if the modification works. However, I hear modifications generally just forestall the inevitable. The owners/sellers have very difficult decisions to make, but they need to understand it is better for them to make the decisions than to make the lender make the decisions.

Hopefully your post will seller facing a difficult decision will contact a professional that understands the options and is willing to work with them.

It should also be noted that I have seen some sellers, realtors and lenders try to coordinate a short sale closing with the purchase of a new property. Unless full and complete disclosure is made to the old lender, new lender, realtors and underwriters, this can create legal problems.

"Will I ever be able to buy a home again?"

Today I received another call from another homeowner in foreclosure. Burning questions that no one could (or would) answer were pouring out like lava, pent up emotions were finally being released in a meltdown of fear, frustration, sorrow, confusion, anger.

I just listened, acknowledged, and took notes, listening to learn if I would be able to help.

Eventually, in sharing with me, there was some relief from the pressure, and the courage to ask a question about the future arose: "Will I ever be able to buy a home again?"

Yes! As long as you can financially afford it with a steady source of income and a downpayment, YES. You will be able to buy another house in the future. Usually in about two years after a short sale, you will be eligible to purchase a home and get a loan.

If you opt for foreclosure, it will be seven years, but you will still be able to buy another home in the future, based on standards of the lending community as we know it.

A short sale will give the fastest return to loan eligibility. But even a foreclosure does not mean you will never be able to buy a home again.